Increased regulation and hostilities in countries around the world have made it more dangerous for U.S. companies to send employees overseas for jobs. The potential for terrorist activities here at home also requires special risk and crisis management expertise so companies can protect their employees who are in dangerous situations.
In response, a Beazley Lloyd’s Syndicate and multiple crisis and risk management firms have banded together to form the Hostile Environment Liability Protection program – also known as HELP.
Matthew Waghorn, underwriter for Beazley Syndicate, Lloyd’s, says the program was built in conjunction with global broker Integro based on its 10 years of experience insuring risks in hostile environments.
“This sector is always moving and you have to move your appetite appropriately,” says Waghorn. “We decided we wanted to build on what we have done in the past into the norm for our clients. What is good for us is good for them.”
The HELP program was created for those organizations operating in hostile or complex environments, such as security, logistics, engineering and construction firms, as well as non-governmental organizations (NGOs), charities or media that deploy to war zones. Specialist firms for domestic operations like nuclear installation protection, air, sea and land security, Homeland Security, VIP protection, explosive detection and related work are also eligible for the program.
HELP incorporates insurance coverages like general liability, professional liability, employers liability, technology coverage, and human asset coverage with risk mitigation and crisis response services.
The specialist insurance coverage is offered through a Lloyd’s facility that is open to all brokers and has experience insuring land-based and marine operations in conflict zones. Beazley is the lead insurer but works with a combination of syndicates to provide a total of up to $20 million per risk. Coverage is also available on a project basis.
The “consortium” of risk management experts and crisis response services include teams of legal, risk register, due diligence and security management firms, as well as emergency response, crisis management and legal response services. Insureds also have the option of using their own trusted risk advisors and have the costs associated with those fully funded or co-funded by their HELP insurance with prior approval from underwriters. The program may also be open to other firms at some point.
“We felt to start off with we should focus on those firms we have worked with closely over the last 10 to 15 years on crisis response, due diligence and crisis management,” said Simon Koe, principal of Integro Group in the UK, the facilitator for the program. “We have specifically chosen these practitioners in their chosen subjects. That could grow over time but that’s where we are initially focusing.”
Koe says the HELP program is open to legitimate entities that don’t have “question marks over them.”
“We are trying to attract top of the sector companies that operate in difficult locations. It’s those companies that get it as far the benefits that come from the HELP product,” he says.
Waghorn says one of the biggest dangers of people working in hostile and complex environments or domestic specialized security is there isn’t enough due diligence done on the coverage they are purchasing.
“Without even taking into account the value-added services we have incorporated, there are many operators that go into hostile environments or even operate domestically that will be missing key elements to their policy,” he says.
Some of the biggest claims in this market, says Waghorn, have come from situations where there was a history of problems, such as employing people with prior mental health issues, improper training on the handling of weapons, or inadequate driver safety training for navigating roads in dangerous conditions/countries.
The crisis response services can help clients navigate what to do if something serious happens and potentially save employees lives. Or, at the very least, a company’s reputation, he says.
“As the world becomes more regulated – and this industry in particular – if something goes wrong it is your name in the paper,” said Waghorn.
Koe says while there is an obvious focus on well-known hostile environments like the Middle East or more recently Ukraine, companies that operate in Western cities that have not previously been on the “danger” radar should still look at risk protection and transfer.
“I was speaking to an underwriter who just came from Paris and he was very surprised by the security levels there. There is a real sense of nervousness around the shifting element of hostility coming into Western cities,” he says. “What HELP is trying to do is give the experience and expertise we have gained over the last 15 years to those entities that may not see their overseas risks as vulnerable.”
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